Mukesh Kumar vs State & Anr.
2017 Latest Caselaw 610 Del

$~12.
*       IN THE HIGH COURT OF DELHI AT NEW DELHI

+                                               Date of Decision: 02.02.2017

%       CRL.L.P. 555/2015

        MUKESH KUMAR                                       ..... Petitioner
                           Through:    Mr. Vikram Gujral and Mr. Dhurv
                                       Bose, Adv.
                           versus
        STATE & ANR.                                       ..... Respondents

                           Through:    Mr. Manoj Kumar Garg                   and
                                       Mr.Siddharth Patra, Advocate


        CORAM:
        HON'BLE MR. JUSTICE VIPIN SANGHI

VIPIN SANGHI, J. (OPEN COURT)

1. The present leave petition is directed against the judgment dated 28.04.2015 passed by the learned MM (S)-01, NI Act, Saket Courts in CC No.5206/01, whereby the respondent/ accused has been acquitted of the offence under Section 138 of Negotiable Instruments Act on the complaint of the petitioner.

2. The submission of the petitioner is that the loan taken by the accused had been acknowledged by him in a Memorandum of Settlement (MOS) dated 15.10.2010 (Ex. CW-1/1); the receipt executed by the accused on the same day i.e. 15.10.2010 (Ex. CW-1/X), and; the promissory note dated 15.10.2010 (Ex. CW-1/2 colly). The cheque dated 15.06.2011 was issued

towards repayment of the loan as recorded in the MOS dated 15.10.2010. Despite this being the position, the Trial Court has travelled into a wholly unnecessary area of inquiry, by inquiring into the financial capacity of the complainant. On this aspect, it is submitted that during his cross examination, the complainant had stated that he was doing his business at the time of grant of loan and his saving was Rs.50,000/- p.m.

3. Learned counsel points out that the defence of the accused was that he had taken loan from one Manoj Kumar, which he had allegedly repaid. The accused had claimed that the cheque in question had been given to Manoj Kumar towards security, which had been misused by the complainant. Neither Manoj Kumar was produced, nor the taking of loan from Manoj Kumar was evidenced, much less, the return of loan was evidenced. It was not explained as to why the cheque was not taken back from the so-called Manoj Kumar when the loan taken from him was allegedly repaid, and why the accused took no steps if the cheque was not returned by Manoj Kumar even though the loan was allegedly repaid.

4. In my view, the present is a fit case for grant of leave as the impugned judgment appears to be laconic. Leave granted.

Crl A. No............................./ 2017

5. Let the appeal be registered and numbered.

6. With the consent of parties, the appeal is taken up for hearing today itself.

7. The present appeal is directed against the judgment dated 28.04.2015 passed by the learned MM (S)-01, NI Act, Saket Courts in CC No.5206/01,

whereby the respondent/ accused has been acquitted of the offence under Section 138 of Negotiable Instruments Act on the complaint of the petitioner. The case of the appellant was that the complainant and the accused run their shops in the same market and they had cordial relationship. About 3-4 years prior to filing of the complainant, the shop of the accused was engulfed in a fire, and it was completely gutted. The goods of the accused were also burned. In that background, the accused approached the complainant for a loan of Rs.3 lacs and assured him to repay the loan within one year with interest @ 18% p.a.

8. The complainant advanced a loan of Rs.3 lacs in cash to the accused. Thereafter, the accused kept taking further loans and thus a total amount of Rs.7.30 lacs was outstanding towards the complainant by the accused. In respect of the said outstanding liability, the parties recorded a MOS on 15.10.2010 (Ex.CW-1/1), wherein the accused acknowledged the liability to pay the sum of Rs.7.30 lacs to the appellant. In the MOS itself, the accused acknowledged delivery of the post dated cheque in question. The accused also executed the receipt for the said amount on the same day i.e. 15.10.2010 (Ex. CW-1/X), and a promissory note for the same amount, on the same day (Ex. CW-1/2).

9. Simultaneously, the accused also issued the cheque in question drawn in favour of the appellant for Rs.7.30 lacs - which was a post dated cheque dated 15.06.2011. The case of the appellant was that when the said cheque was presented for payment, it was returned with the remark "account closed" vide memo dated 28.06.2011. Consequently, a demand notice was issued dated 15.07.2011 to the accused. However, the accused failed to

make payment of the outstanding amount. It is informed that no response to the said legal notice was given by the accused. Consequently, the complaint was preferred by the appellant.

10. Upon being summoned, the accused pleaded not guilty and claimed trial. The complainant examined himself as CW-1. During his examination, he deposed that at the time when he had advanced the loan he was doing multiple tasks, namely, running a dairy business, working as part time driver and was also engaged in the business of selling ice. The complainant also led in evidence the aforesaid documents, namely, the MOS, receipt and promissory note.

11. In his statement recorded under Section 313 Cr PC, the accused admitted that his shop no.58 caught fire and the goods therein were completely burned in the year 2007. He denied to have ever approached the complainant to obtain a loan of Rs.3 lacs with interest @ 18% p.a. He also denied the settlement set up by the complainant contained in the MOS. He also stated that he had never taken any loan from the complainant. He denied receipt of the legal notice. In answer to the last question, he made a statement that he had not issued the cheque in question to the complainant. He stated: "It may be given by one Manoj Kumar to the complainant. I had taken a loan from Manoj Kumar which I had already repaid. I had given the cheque in question to Manoj Kumar towards security. It appears since the complainant and Manoj Kumar are from the same hometown, Manoj Kumar has provided my cheques alongwith promissory note to the complainant. Apart from the cheque in question there are other three cheques are in possession of complainant. In fact the complaint has liability

of Rs.3.50 lakhs towards me".

12. The Trial Court has acquitted the accused on the premise that the witnesses to Ex CW-1/1, CW-1/2 and CW-1/X had not been produced by the appellant. The complainant in his cross examination had stated that no other person was present when the accused had handed over the pro note to him, and he also did not remember whether the pro note and the receipts were signed on the same day. The Trial Court also observed that there was a contradictory statement made by the appellant with regard to the presence of the witnesses Sanjay Sharma and Rajesh Roy, who were witnesses to Ex CW-1/1, CW-1/2 and CW-1/X. The Trial Court doubted the said documents, since CW-1 the complainant, did not remember the date and time when he visited Patiala House Courts for executing the said documents. The Trial Court also proceeded to examine the financial capacity of the complainant and doubted his capacity to advance the loan to the accused. This was on the premise that the appellant stated that he used to drive an auto, while he had also claimed that he runs a dairy shop and was also having a part time business of selling ice. The complainant also stated that he did not file any income tax returns.

13. The Trial Court also proceeded on the basis that the shop of the accused had caught fire in the year 2008, and not 2007 as claimed by the complainant. The reasoning given by the Trial Court in the penultimate paragraph of the impugned order reads as follows:

"The complainant in the present case has placed on record documentary record to prove his case but he is neither aware of the contents of his complaint nor is he aware about the contents of the documents nor is he aware about the facts of the present

case. He has been unable to prove his financial capacity nor has he been able to show when and how the loan was provided. Questions have been raised with respect to the authenticity of documents Ex. CW1/1, CW1/2 and CW1/X and he has given contradictory and inconsistent statement with respect to the contents thereof and he was not aware whether any other witness was present during the execution of the same or not. He has not examined any other person except himself to show proof of execution of the aforesaid documents. The complainant has also been unable to answer the basic questions with respect to the advancement of alleged loan amount".

14. The submission of counsel for the appellant is that the Trial Court has selectively read the deposition of CW-1. Learned counsel submits that CW- 1 had studied upto 5th grade only. He was consistent in his stand that he had initially advanced an amount of Rs.3.00 lacs when the shop of the accused was gutted in fire. Thereafter he kept advancing amounts of Rs.75,000/-, Rs.80,000/- and Rs.70,000/- to the accused at different intervals.

15. Learned counsel submits that the complainant had deposed that he was not earning for the last 3-4 years (when he deposed on 21.03.2014), and that he was totally out of job. He also stated that when the loan was provided to the accused "I earned about Rs.50,000/- per month excluding my expenses. I used to run my dairy shop and also worked as driver and had part time ice business".

16. Learned counsel submits that so far as Ex CW-1/1, CW-1/2 and CW- 1/X are concerned, the complainant had deposed:

"When the agreement was entered between me and the accused, Sanjay Sharma, Rajesher Roy were present in the market. Both are not operating in the market at present".

17. However, the Trial Court has selectively read the evidence and misconstrued the same. Learned counsel submits that at another place, the witness had stated:

"There was no other person present at the time of execution of MoU Ex. CW1/1 however the other shop keeper of the market were aware that the accused had taken loan and there had been a confrontation between me and the accused in their presence".

18. Learned counsel submits that the entire testimony has to be read and understood in a meaningful way and the later part of the statement, obviously, meant that apart from the parties and the named witnesses, no other witness were present at the time of execution of the MOS.

19. Learned counsel for the appellant further submits that the Trial Court has completely misdirected the inquiry in the present case inasmuch, as, in the face of Ex CW-1/1, CW-1/2 and CW-1/X, there was no occasion for the Trial Court to venture into the issue with regard to the financial capacity of the complainant. The presumption raised in favour of the complainant under Section 139 of Negotiable Instruments Act had not been rebutted by the accused inasmuch, as, he merely stated that he had issued the cheque in question to one Manoj Kumar against a loan taken from him, which had been handed over by Manoj Kumar to the complainant. However, the transaction between the accused and Manoj Kumar was never proved by leading any cogent evidence.

20. The accused had appeared as his own witness as DW-1. In his cross examination, the accused/DW-1 admitted that he had not issued any letter or notice to Manoj Kumar for return of the blank cheque issued by him to Manoj Kumar. Learned counsel also points out that it was suggested to the complainant during his cross examination that the pro note and receipt were signed by the accused and given in blank to the complainant. Thus, the delivery of the said documents by the accused to the complainant was an aspect that was suggested by the accused himself. The accused, however, during his cross examination shifted his stand by claiming that the documents CW-1/1 and CW-1/2 were given by him to the said Manoj Kumar. The accused also admitted that he did not give any instructions to the bank to close his account pertaining to the cheque in question. He also admitted that he had not written any letter to the complainant to return the cheque in question.

21. On the other hand, counsel for the respondent/ accused has supported the impugned judgment. Learned counsel submits that the complainant could not establish his financial capacity to advance such a large amount. He further submits that the MOS was signed by the complainant as Mukesh Verma, though he claimed his name as Mukesh Kumar. He further submits that the complainant was not aware about the contents of his complaint, as well as the content of the document. He submits that in relation to Ex CW- 1/1, CW-1/2 and CW-1/X, the complainant had made contradictory and inconsistent statements.

22. Having heard learned counsels for the parties, perused the impugned judgment and gone through the testimonies relied upon by the parties as also

the documents referred to, I am of the view that the impugned judgment is patently laconic, unsustainable in law, and deserves to be set aside. The approach of the Trial Court while rendering the impugned judgment is completely misdirected, and the Trial Court has failed to take into account the most relevant and germane aspects of the case.

23. First and foremost, the fact that the cheque has been signed by the accused is not denied by the accused. This itself raises a presumption against the accused under Section 139 of Negotiable Instruments Act that the cheque had been issued in respect of an outstanding debt or for consideration. The accused had claimed in his defence that the said cheque had been delivered to one Manoj Kumar from whom he had taken a loan, which he had repaid. The accused claimed that the cheque was not returned by Manoj Kumar to him and that Manoj Kumar - who was also known to the complainant, had delivered the cheque to the complainant for it being misused. The same story was adopted in respect of Ex CW-1/1 and Ex. CW-1/2.

24. The presumption under Section 139 of Negotiable Instruments Act is a rebuttable presumption, and the standard of proof required to rebut the said presumption is on preponderance of probabilities. On the other hand, the standard of proof required to establish the guilt of an accused in a criminal trial is, beyond reasonable doubt.

25. In the present case, the initial burden was on the accused to probablise his defence. It was for the accused to establish upon preponderance of probabilities, his defence that he had taken a loan from Manoj Kumar in respect whereof the cheque had been issued. However, the accused did not

produce the so-called Manoj Kumar to establish his loan transaction with Manoj Kumar, and also to establish that he had delivered the cheque in question to Manoj Kumar. No document evidencing the alleged loan transaction with Manoj Kumar was produced by the accused. He did not produce his own accounts / ITR to show that he had reflected the so called loan taken by him from Manoj Kumar in his books. The statement of the accused is as vague, as could be. He gives no particulars of the amount of loan taken from Manoj Kumar; the date of the said loan transaction; the manner in which it was taken - i.e. whether in cash or through cheque; the dates(s) of its repayment, and; the manner of its repayment i.e. whether in cash or through cheque. Though the accused claimed that he had repaid the loan to Manoj Kumar, no document evidencing repayment of the loan was produced.

26. If the story of the accused were to be believed, one thing it becomes clear that the accused had executed Ex CW-1/1 and Ex CW-1/2, which were given to the so-called Manoj Kumar. This itself shows that in the so-called transaction with Manoj Kumar, the parties had resorted to creation of documentary evidence. If that was the modus operandi adopted by them, then it does not stand to reason that at the time of repayment of the alleged loan taken from Manoj Kumar, the parties would not execute further documents to evidence repayment of the loan.

27. The accused also did not explain as to why the cheque allegedly given to Manoj Kumar was, firstly, given in blank i.e. without name and, secondly, why it was not taken back at the time of repayment of the loan to Manoj Kumar. No notice or communication was issued by the accused to Manoj

Kumar, recording that the loan had been repaid but the cheque not returned. The accused also did not stop payment of the said cheque by issuing any communication to his bank contemporaneously. The stand taken by the accused that documents Ex CW-1/1 and CW-1/2 had been given to Manoj Kumar is also completely belied by a perusal of the said documents. Both these documents have been executed in favour of, and by reflecting the name of the complainant Mukesh Kumar, and not Manoj Kumar. Had the loan been taken from Manoj Kumar and the said document executed and delivered, the same would have been delivered in the name of Manoj Kumar and not Mukesh Kumar. Thus, the stand taken by the accused in his defence with regard to issuance of the cheque to secure a loan taken from Manoj Kumar, was not at all probabalised. Pertinently, in his statement under Section 313 Cr PC, the accused also claimed that "apart from the cheque in question, there are other three cheques which are in possession of the complainant. In fact the complainant has liability of Rs.3.50 lakhs towards me". The accused did not explain as to why or how the complainant would be in possession of three cheques issued by him. He also did not lead in evidence any material to show that the complainant owed Rs.3.50 lacs to him. This statement at least, shows that the parties knew each other, and their relationship was such that they could undertake a loan transaction inter se.

28. Pertinently, in his statement recorded under Section 313 Cr PC, the accused did not claim that the complainant did not have the financial capacity to advance the loan amount of Rs.3 lacs, Rs.75,000/-, Rs.80,000/- and Rs.70,000/- in installments to him. In any event, the Trial Court has

gone into the said aspect. Firstly, in view of the defence disclosed and the evidence led by the complainant, such an inquiry was not even called for. Pertinently, in relation to Ex CW-1/1, CW-1/2 and CW-1/X, the accused did not lead any evidence to show that they had been fabricated by misusing any document that he may have given to the so-called Manoj Kumar.

29. The Trial Court, for the purpose of disbelieving the said document, has conveniently read only a part of the testimony of CW-1 and not his entire testimony as a whole, which should have been done. The Trial Court should have appreciated that the complainant had studied upto 5th grade only. His statement was categorical that the agreement was entered into between him and the accused in the presence of Sanjay Sharma and Rajesher Roy. His statement that no other person was present at the time of execution of Ex CW-1/1 has, therefore, to be understood in the context of his statement of the same day made earlier, which is recorded on the same page. However, the Trial Court has conveniently only picked up the later part of the statement, by ignoring the earlier part of the testimony of the complainant. What has not been appreciated by the Trial Court, is that, the purpose of cross examination is not to test the memory of a witness. If the complainant was not able to recall the contents of the complaint and documents, it does not mean that the complaint itself is false. On a plain reading of the testimony of the complainant, it is seen that the same is coherent and consistent.

30. The non filing of his ITR by the appellant during the relevant years does not lead to the creation of a doubt with regard to his financial capacity. Such a doubt may have been raised if there was no other cogent evidence to

establish the loan transaction. But, since the loan transaction and outstanding liability was clearly evidenced by Ex. CW-1/1, CW-1/2 and CW-1/X, the omission of the appellant to file his ITR pales into insignificance for the present purpose.

31. On the aspect of the complainant not producing other witnesses, the complainant had frankly stated the fact which, unfortunately, is generally true. He had stated that other shopkeepers of the market are also aware that the accused had taken money from him. However, he expressed his inability to bring any person for giving evidence in court as nobody wants to get involved in others affair.

32. The minor discrepancy, if any, with regard to the year in which the shop of the accused was gutted in neither here, nor there. Such minor inaccuracies are known to creep in and are natural with passage of time in ones' recollection of the events.

33. Reliance placed by counsel for the respondent on Vijay v. Laxman & Anr., (2013) 3 SCC 86 is completely misplaced. This was a case where the High Court had upset the concurrent findings of the Trial Court and the Revisional Court. The judgment of the High Court in this case was upheld by the Supreme Court. I fail to appreciate as to for what purpose this judgment has been cited. It has no relevance to the present case.

34. Counsel for the respondent also places reliance on Kalavally v. Parthasarathy, 2009 (1) RCR (Crl) 333 decided by the Madras High Court. This decision has no application to the facts of the present case. In this case, the accused claimed that she had no transaction of any kind with the complainant, and that the complainant did not have the means to advance an

amount of Rs.3.29 lacs. The accused claimed that her cheque book had been stolen and she had reported the matter to the police. In the present case, as noticed above, the accused did not take any steps in relation to the return of the cheque by the so called Manoj Kumar, since it was claimed that the cheque had allegedly been issued to Manoj Kumar against a loan which allegedly had been repaid. Moreover, in Kalavally (supra), the complainant had merely relied upon the cheque, without any other documentary evidence to support the transactions. In contrast, in the present case, the complainant has led in evidence three vital documents which are Ex CW-1/1, CW-1/2 and CW-1/X, as taken note of herein above.

35. Reliance is also placed on Yeshpal v. Vijayakumar, 2008 (2) LW (Crl) 834 decided by the Madras High Court on 03.03.2008. In this case, the defence of the accused was held to be probabalised by the fact that the complainant did not produce any document in relation to the loan transaction of Rs.1.85 lacs in respect whereof the cheque was allegedly issued. The complainant had claimed that the amount had been lent after the withdrawal from his account. That assertion was found to be false by the passbook of the complainant, which was marked Ex. P-9. In the present case, the complainant has not claimed to have advanced the amount in one go, and after withdrawing the monies from his bank. His claim is that he has advanced monies earned by him in cash from his multi faceted business. He claimed to have advanced Rs. 3.00 lakhs initially, and Rs.75,000/-, Rs.80,000/- and Rs.70,000/- in instalments later. Thus, the principal liability was Rs.5.25 lakhs. His case was that this loan was given on interest @18% p.a. Moreover, the complainant has led in evidence three crucial documents

to establish not only the existence of the loan, but also the issuance of the cheque towards repayment thereof. This decision is, therefore, of no avail.

36. For all the aforesaid reasons, the impugned judgment is set aside and, since all the ingredients of the offence under Section 138 NI Act are established in the present case, the respondent/ accused is convicted of the offence under Section 138 of Negotiable Instruments Act.

37. List on 08.05.2017 for sentencing. The respondent/ accused shall remain present in court on the next date.

VIPIN SANGHI, J FEBRUARY 02, 2017 sr